Magazine ad spending, a leading indicator of revenue for
increased by 5% in Adobe's February quarter, up from 2% growth a year earlier.
The data comes from the Magazine Publishers Association, which found that spending in February alone grew by 6% year over year.
The report is the second positive indicator for Adobe in the last few business days. Last week, the Interactive Advertising Bureau reported that online ad sales rose 32% to a record $4.8 billion in the last quarter.
In a note to clients published Monday, PiperJaffray analyst Gene Munster said: "With both print and Internet ad spending continuing to grow on a year over year basis, we believe Adobe's primary end markets remain strong."
Munster noted that many Adobe products, such as PageMaker, Photoshop, Creative Suite and others, are used in the design and layout of magazine and other print ads. "Magazine ad spending has historically been a directional indicator for Adobe revenue, with a one-quarter lag," Munster wrote.
Munster added that he believes Adobe will hit Wall Street's expectations when it reports first-quarter earnings on March 20 and likely surpass them for the full fiscal year. Analysts polled by Thomson First Call are expecting a first-quarter profit of 29 cents a share on revenue of $655 million.
For the year, the company is expected to post a profit of $1.46 a share on revenue of just under $3 billion. Piper Jaffray makes a market in Adobe securities but does not have an investment banking relationship with the company.
Shares of Adobe were recently up 30 cents, or 0.8%, to $39.48.